Two California groups that support the U.S. Labor Department's fiduciary rule effort say officials in their state are rushing an annuity sales rule alternative through the state Legislature.
The Consumer Federation of California and the Life Insurance Consumer Advocacy Center assert in a new joint commentary that they believe that California Insurance Commissioner Ricardo Lara and the California Department of Insurance are supporting SB 263, the California version of a National Association of Insurance Commissioners model bill.
Sen. Bill Dodd, D-Napa, California, introduced S. 263 in March 2023. The consumer federation, the advocacy center and other opponents succeeded at stalling action in October.
Robert Herrell, the federation's executive director, said that the possibility that the bill could become law stinks.
"It feels like the fix is in between the California insurance regulator, the life and annuity insurance industry he's supposed to be regulating, and Senator Dodd," Herrell said.
What it means: California may soon adopt annuity rules similar to the version most other states have adopted.
The Securities and Exchange Commission already regulates variable annuity sales.
Some state officials believe that adopting the same annuity sales rules throughout the country could keep SEC from using a Dodd-Frank Act provision to get jurisdiction over nonvariable annuities.
